Theory and Practice
✔ Applies to US GAAP (ASC 842) Finance Leases
✔ Applies to US GAAP (ASC 842) Operating Leases
✔ Applies to IFRS (IFRS 16)
✔ Applies to UK GAAP (FRS 102)
In practice, the lease payment can occur at any time during a reporting period. Therefore, it is seen as a payment against the lease liability. In our example of a monthly payment of $10,000, the entry would be as such:
Doing it in Sage Intacct Lease Accounting
Once a lease has been placed in service, entries can be generated automatically or as manually initiated by a user. Read more on this topic here.
If, in this example, the lease was set up to create AP Bills, an AP Bill with the following Entries and Posting details will be posted:
| Account | Debit | Credit |
|---|---|---|
| Lease Liability | $10,000.00 | |
| Cash, Accounts Payable or Accrual | $10,000.00 | |
| Payment is used to pay against the principal, expenses will be calculated at period end date(s). The credit account will differ based on the transaction type selected against the Lease. | ||
